Mumbai, June 6 -- Commodity exchange MCX has received approval from the markets regulator SEBI to launch electricity derivatives.

"This development underscores the strong commitment and support of the Regulators - SEBI and Central Electricity Regulatory Commission (CERC) - in enabling a dynamic and sustainable power market," MCX said in a statement Friday, announcing the development.

The electricity derivatives contracts to be introduced by MCX will enable generators, distribution companies, and large consumers to hedge against price volatility and manage price risks more effectively, by enhancing efficiency in the power market.

Praveena Rai, MD and CEO, MCX, said in the statement that introducing electricity derivatives marks a pivota...